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Citizens may have to pay the international price for fuel as Prime Minister Dr Keith Rowley warned that this country has spent tens of billions in keeping prices low.

Rowley said T&T is in a volatile energy scenario with the potential for fuel prices to move in either direction.

In the current circumstances, he said this country may have little choice but to implement a fuel liberalisation programme to allow domestic fuel prices to move freely with market prices.

Speaking at the T&T Energy Conference hosted by the T&T Energy Chamber, Rowley assured, however, that in any such arrangement, measures will be implemented to cushion the impact on the travelling public.

“It is, therefore, important that our transportation policy moves away from the current model based solely on liquid fossil fuels,” Rowley said, noting once more that the future of mobility will be electric, with electric vehicles becoming the preferred climate-friendly transportation option.

And given the uncertainty of energy transition, the Prime Minister also noted that it is difficult to define the end game, that is, which technology will emerge and what will be the final energy mix.

“Therefore, it is in our interest to expeditiously take steps to monetise the country’s abundant oil and gas resources,” he added.

According to Rowley, the latest gas reserve audit established that at year end 2020 technically recoverable resources amounted to 23.2 trillion cubic feet (tcf) and prospective resources at 55.2 tcf.

Whereas the latest oil audit, established 3P reserves at 455.3 million barrels and prospective resources amounted to 3.2 billion barrels with 90 per cent being in T&T’s deep-water province, he added.

Accordingly, the PM said this country has embarked on a series of bid rounds which commenced with the deep-water bid-round in December of last year.

The closing ceremony for this bid round will be held on Thursday.

On offer is a large selection of deep water acreage comprising 17 blocks.

Noting that T&T is not singular in the matter as several countries are actively promoting bid-rounds at this time, the PM said there is also competition for exploration capital.

“Seven licensing rounds were closed by the first quarter 2022 and another eight licensing rounds, that are open, are expected to close by the end of 2022. Regionally, Suriname, Colombia and Brazil closed successful bid-rounds. Upcoming 2022 bid-rounds comprise Guyana’s deep-water blocks, Brazil sub-salt blocks and Ecuador oil blocks,” Rowley noted.

He also added that in September 2021 the Ministry of Energy and Energy Industries invited nominations for Onshore Acreage for Competitive Bidding and 11 blocks were nominated.

Based on the responses, Rowley said the ministry plans to launch the onshore competitive bid round within this quarter.

“The offshore shallow water bid-round will be next. In total there are 25 open shallow water blocks for consideration. A date for the launch has not yet been determined,” Rowley added.

Further, he said the proliferation of bid-rounds will increase the competition for capital in an energy market that is undergoing transition.

“While we are acknowledged as a proven hydrocarbon province with substantial unrealised potential, we need to maintain our competitiveness and resilience,” Rowley said.

This, he added, involves the lowering production costs, improving oil and gas production efficiency, an attractive fiscal regime and a more expeditious execution of the regulatory oversight.

Moving towards new resources

As T&T moves to identify new resources, available resources have to be managed.

And management of the country’s hydrocarbon resources has not been without challenges, Rowley said, noting that a combination of COVID-19, low commodity prices and technical issues have setback levels of both oil and gas production.

However, with the ease in the pandemic and new activity, both oil and gas production are set to rise.

According to Rowley, with new production coming onstream in 2022 and 2023, gas production is projected to increase from present levels to 3.2 trillion cubic feet by 2024.

Gas supply between 2024 and 2027, he added, will be tight before improving in 2028 with the coming onstream of mega projects, the Manatee and Calypso.

However, the PM said the key to a sustained gas industry will be the exploration and development of the country’s hydrocarbon resources as well as access to cross-border natural gas resources.

Additionally, Rowley said given the leading role that hydrogen is poised to play in the energy transition, there is opportunity by industry players to embrace hydrogen in the creation of a sustainable petrochemical industry.

To this end, state-owned National Gas Company and its wholly-owned subsidiary National Energy in collaboration with Kenesjay Green Ltd (Kenesjay) are actively collaborating on the creation of a sustainable hydrogen economy for the energy sector of T&T, Rowley noted.

He added that NGC has also been instrumental in the formation of a new green agenda sub-committee of the Point Lisas Energy Association (PLEA) which will lead PLEA sustainability and green agenda actions, and coordinate synergies among member companies.

“It is this spirit of co-operation together with innovation that will enable the Point Lisas Industrial Estate to maintain its relevance and status as a world class industrial centre.

“An embodiment of these characteristics is the initiative being pursued by Kenesjay Green Ltd and Hydrogen de France to establish the country’s first industrial project to produce carbon-free hydrogen. Kenesjay and Hydrogen de France are to be applauded for their ingenuity and it is hoped that other companies will follow suit,” Rowley said.

Additionally, he said a comprehensive, inclusive and cost-effective strategy to address climate change requires bringing in complementary policy areas and exploiting synergies among them.

A case in point, he cited, is electric vehicles.

However, there’s no quick fix.

Noting that the energy landscape is rapidly evolving and therefore strategies should be geared to respond in a timely fashion to changes in the market, Rowley said how the industry fares in the transition depends to a large extent to the country’s collective efforts.

This year marked the first-in person energy conference since 2020 under the theme, “Leveraging the industry’s strengths for the energy transition.”